An unprecedented series of guilty pleas had been extracted by the US Department of Justice from four of the banks: Barclays, RBS, Citigroup and JP Morgan. UBS was granted immunity for being the first to report the manipulation of the £3.5tn a day foreign exchange markets.

Barclays was fined £1.5bn by five regulators, including a record £284m by the UK’s Financial Conduct Authority, which had levied fines against other banks last November. The FCA portion of the Barclays fine will go to the UK government which did not disclose how it intended to spend it. The bank said it would fire eight staff as part of a deal with the New York regulator.

The FCA said Barclays engaged in collusive behaviour with rivals, and used chat rooms to manipulate rates. In one chat room, a trader described himself and his fellow participants as “the 3 musketeers” and said “we all die together”.

Georgina Philippou, the FCA’s acting director of enforcement and market oversight, said of the Barclays fines: “This is another example of a firm allowing unacceptable practices to flourish on the trading floor.

“Instead of addressing the obvious risks associated with its business Barclays allowed a culture to develop which put the firm’s interests ahead of those of its clients and which undermined the reputation and integrity of the UK financial system.

“Firms should scrutinise their own systems and cultures to ensure that they make good on their promises to deliver change.”

But the Barclays shares were the second biggest risers in the FTSE 100 after the fine was announced as it had set aside £2bn to cover the fines. The shares rose 3%. Antony Jenkins, appointed to run Barclays in the wake of the 2012 Libor rigging scandal, said: “I share the frustration of shareholders and colleagues that some individuals have once more brought our company and industry into disrepute”.

Other top bankers also expressed their concern. Ross McEwan, RBS boss, said: “The serious misconduct that lies at the heart of today’s announcements has no place in the bank that I am building. Pleading guilty for such wrongdoing is another stark reminder of how badly this bank lost its way and how important it is for us to regain trust”.

RBS, 79% owned by taxpayers, was fined £430m – on top of the £400m of penalties announced in November. It also warned it could still face further action. It has fired three people and suspended two more.

Citigroup was fined £770m, while JP Morgan, the biggest bank in the US – which has paid fines totalling more than £26bn since 2009 – was fined another £572m. Its boss, Jamie Dimon, said: “The conduct described in the government’s pleadings is a great disappointment to us. We demand and expect better of our people. The lesson here is that the conduct of a small group of employees, or of even a single employee, can reflect badly on all of us, and have significant ramifications for the entire firm.”

At the time of the November 2014 settlement, regulators in the UK and the US described a “free-for-all” culture on trading floors. RBS, HSBC, JP Morgan, UBS and Citibank were fined by the FCA, and US regulators also fined Bank of America.

The DoJ was not part of those settlements, while Barclays did not participate because of complications with its regulator in the US.

Barclays was also fined £74m for fixing another benchmark, known as the ISDAfix.